6 April 2017
Climbing On Board the Belt and Road
HKGCC magazine "The Bulletin"
Ever since the Belt and Road initiative was announced three years ago, the ambitious intercontinental plan has captured the world's attention, especially countries across Asia where most of it passes through. For Hong Kong, the initiative offers opportunities but the question still remains how to seize them.
There have been discussions about the merits of the Belt and Road initiative, especially given the logistical, geographical and political challenges. These are valid issues but if the plan works out, trade flows and open markets will be the rewards, which would benefit Hong Kong, said Chamber Chairman Stephen Ng in his opening remarks at the second annual China Daily Asia Leadership Roundtable Luncheon.
"Throughout history, economic growth has always correlated strongly with trade flow and open markets. Hong Kong's own success relies entirely on trade flow and open markets. Hong Kong has become too inward looking and less open in recent years, almost 'protectionist.' For over 100 years, Hong Kong opened its market to the world to 'barter' for the world to open its markets to us. We have a small market ourselves and must keep on exploring new markets,” he said.
Ng urged Hong Kong to be more open to the Belt and Road. "The Belt & Road is happening with or without us. It is up to us to decide whether we wish to be left behind. Is Hong Kong open for business? Or is it closed?"
Given Hong Kong's status as an international finance hub and its highly developed financial services industry, we can exploit this advantage for the Belt and Road initiative as well.
"Without capital, the Belt and Road and its massive infrastructural projects cannot leave the drawing boards. Hong Kong can make things happen, and for a host of reasons," said Hong Kong Chief Executive CY Leung.
Hong Kong's expertise in finance goes beyond just traditional areas, with Islamic financing a key developing field. "The success of our two sukuk issuances in the past two years displayed to the world our ability to launch Islamic financial products and manage their financing needs. That can only help us down the road, given the number of Islamic countries backing the Belt and Road," he added.
Leung also announced a new support scheme to help professionals in foreign markets. The Government is allocating HK$200 million for the Professional Services Advancement Support Scheme (PASS), which is intended to support non-profit projects engaged in cooperation with professionals in overseas countries and carry out research and publicity activities to boost the industry.
In addition, the Government launched a scholarship program last December for undergraduate students from Belt and Road countries to study in Hong Kong. The Hong Kong Scholarship for Belt and Road Students began with Indonesia and was just extended to Malaysia.
"The plan is to gradually expand the scholarship to other Belt and Road countries. We have just extended the scheme to Malaysia, offering 10 scholarships to Malaysian students enrolled in undergraduate programmes here, beginning in the next academic year. We welcome the private sector to join us in offering Belt and Road scholarships," said Leung.
He believes there are ample opportunities but that more needs to be done to spread the message. "How do we grab opportunities for all? There is more messaging to be done."
Leung said there are already a lot of Hong Kongers working abroad, "300,000 or 8% of the workforce work in the Mainland. More young Hong Kong architects are knocking on doors in India and moving more to Malaysia and Indonesia."
Panellists also urged the Hong Kong Government to be more proactive in seeking more ties and agreements with other entities.
"Hong Kong can be a super connector but connecting who, what, how? If we can answer these questions, then we can concentrate our resources," said Professor Edward K. Y. Chen, President, Qianhai Institute for Innovative Research.
"How to connect? Simple, you have to establish connections or you will never connect. What Hong Kong lacks is a partner, our partner in many ways can be Qianhai Free Trade Zone, which the Central Government has designated as a supporting hub, and where the financial innovations are being tested as pilot programs. Hong Kong has not been able to see the importance of Qianhai," warned Chen.
"The Government can do more in areas like visa enhancement, trade agreements, tax agreements and new air service agreements," said Ivan Chu, Chief Executive, Cathay Pacific Airways.
Hong Kong is also seen as a regional connector linking the Mainland and nearby countries.
"Going through Hong Kong to ASEAN countries will be smoother, as sometimes it is a bit sensitive, like Vietnam," said Dr Jonathan KS Choi, Chairman, Chinese General Chamber of Commerce.
Foreseeing a winning situation for everybody, Leung called on all segments of Hong Kong to work together to become a key link in the Belt and Road initiative.
"Working together – Government, business and community – we, Hong Kong, will be the 'key link,' the 'super-connector,' for the Belt and Road and definitely between the Belt and Road countries and the Mainland of China. And that can only reward us all."
This article was firstly published in the HKGCC magazine "The Bulletin" January 2017 issue. Please click to read the full report.